WRITT

EN
REPOR
Prepared by:
ANDRIA SHELLA C. LACTAM
Reporter

Prepared to:
REYMOND CHRIS MARIBOJOC
Instructor

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INTRODUCTION

TO

MANAGEMENT

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 Understand the meaning and definitions of management
Describe the nature and scope of management
Features, function and importance of management
Know and understand the relation between Administration and
Management
Understand various levels of management
Describe the various skills that are necessary for successful
managers

The concept of management has been around for thousands of years. According to
Pindur, Rogers, and Kim (1995), elemental approaches to management go back at least 3000
years before the birth of Christ, a time in which records of business dealings were first
recorded by Middle Eastern priests. Socrates, around 400 BC, stated that management was a
competency distinctly separate from possessing technical skills and knowledge (Higgins,
1991). The Romans, famous for their legions of warriors led by Centurions, provided
accountability through the hierarchy of authority. The Roman Catholic Church was organized
along the lines of specific territories, a chain of command, and job descriptions. During the
middle Ages, a 1,000 year period roughly from 476 AD through 1450 AD, guilds, a
collection of artisans and merchants provided goods, made by hand, ranging from bread to
armor and swords for the Crusades. A hierarchy of control and power, similar to that of the
Catholic Church, existed in which authority rested with the masters and trickled down to the
journeymen and apprentices. These craftsmen were, in essence, small businesses producing
products with varying degrees of quality, low rates of productivity, and little need for
managerial control beyond that of the owner or master artisan.

The Industrial Revolution, a time from the late 1700s through the 1800s, was a period
of great upheaval and massive change in the way people lived and worked. Before this time,
most people made their living farming or working and resided in rural communities. With the
invention of the steam engine, numerous innovations occurred, including the automated
movement of coal from underground mines, powering factories that now mass-produced
goods previously made by hand, and railroad locomotives that could move products and
materials across nations in a timely and efficient manner. Factories needed workers who, in
turn, required direction and organization. As these facilities became more substantial and
productive, the need for managing and coordination became an essential factor. Think of
Henry Ford, the man who developed a moving assembly line to produce his automobiles. In
the early 1900s, cars were put together by craftsmen who would modify components to fit
their product. With the advent of standardized parts in 1908, followed by Ford’s
revolutionary assembly line introduced in 1913, the time required to build a Model T fell
from days to just a few hours (Klaess, 2020). From a managerial standpoint, skilled craftsmen
were no longer necessary to build automobiles. The use of lower-cost labor and the increased
production yielded by moving production lines called for the need to guide and manage these

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massive operations (Wilson, 2015). To take advantage of new technologies, a different
approach to organizational structure and management was required.

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A business develops in course of time with complexities. With increasing
complexities managing the business has become a difficult task. The need of existence of
management has increased tremendously. Management is essential not only for business
concerns but also for banks, schools, colleges, hospitals, hotels, religious bodies, charitable
trusts etc. Every business unit has some objectives of its own. These objectives can be
achieved with the coordinated efforts of several personnel. The work of a number of persons
are properly coordinated to achieve the objectives through the process of management is not a
matter of pressing a button, pulling a lever, issuing orders, scanning profit and loss statements
and promulgating rules and regulations. Rather it is the power to determine what shall happen
to the personalities and happiness of entire people, the power to shape the destiny of a nation
and of all the nations which make up the world." Peter F. Drucker has stated in his famous
book "The Practice of Management" that, "the emergence of management as an essential, a
distinct and leading social institution is a pivotal event in social history. Rarely in human
history has a new institution proved indispensable so quickly and even less often as a new
institution arrived with so little opposition, so little disturbance and so little controversy?"
Management is a vital aspect of the economic life of man, which is an organized group
activity. It is considered as the indispensable institution in the modern social organization
marked by scientific thought and technological innovations. One or the other form of
management is essential wherever human efforts are to be undertaken collectively to satisfy
wants through some productive activity, occupation or profession. It is management that
regulates man's productive activities through coordinated use of material resources. Without
the leadership provided by management, the resources of production remain resources and
never become production. Management is the integrating force in all organized activity.
Whenever two or more people work together to attain a common objective, they have to
coordinate their activities. They also have to organize and utilize their resources in such a
way as to optimize the results. Not only in business enterprises where costs and revenues can
be ascertained accurately and objectively but also in service organizations such as
government, hospitals, schools, clubs, etc., scarce resources including men, machines,
materials and money have to be integrated in a productive relationship, and utilized
efficiently towards the achievement of their goals. Thus, management is not unique to
business organizations but common to all kinds of social organizations. Management has
achieved an enviable importance in recent times. We are all intimately associated with many
kinds of organizations, the most omnipresent being the government, the school and the
hospital. In fact, more and more of major social tasks are being organized on an institution
basis. Medical care, education, recreation, irrigation, lighting, sanitation, etc., which typically
used to be the concern of the individual or the family, are now the domain of large
organizations. Although, organizations other than business do not speak of management, they
all need management. It is the specific organ of all kinds of organizations since they all need
to utilize their limited resources most efficiently and effectively for the achievement of their
goals. It is the most vital forces in the successful performance of all kinds of organized social
activities. Importance of management for the development of underdeveloped economies has
been recognized during the last one and a half decade. There is a significant gap between the
management effectiveness in developed and underdeveloped countries. It is rightly held that
development is the function not only of capital, physical and material resources, but also of
their optimum utilization. Effective management can produce not only more outputs of goods

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and services with given resources, but also expand them through better use of science and
technology. A higher rate of economic growth can be attained in our country through more
efficient and effective management of our business and other social organizations, even with
existing physical and financial resources. That is why it is now being increasingly recognized
that underdeveloped countries are indeed somewhat inadequately managed countries. The
emergence of management in modern times may be regarded as a significant development as
the advancement of modern technology. It has made possible organization of economic
activity in giant organizations like the Steel Authority of India and the Life Insurance
Corporation of India. It is largely through the achievements of modern management that
western countries have reached the stage of mass consumption societies, and it is largely
through more effective management of our economic and social institutions that we can
improve the quality of life of our people. It is the achievements of business management that
hold the hope for the huge masses in the third world countries that they can banish poverty
and achieve for themselves decent standards of living.

DEFINITION OF MANAGEMENT

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 Although management as a discipline is more than 80 years old, there is no common
agreement among its experts and practitioners about its precise definition. In fact, this is so in
case of all social sciences like psychology, sociology, anthropology, economics, political
science etc. As a result of unprecedented and breath-taking technological developments,
business organizations have grown in size and complexity, causing consequential changes in
the practice of management. Changes in management styles and practices have led to changes
in management thought. Moreover, management being interdisciplinary in nature has
undergone changes because of the developments in behavioral sciences, quantitative
techniques, engineering and technology, etc. Since it deals with the production and
distribution of goods and services, dynamism of its environments such as social, cultural and
religious values, consumers' tastes and preferences, education and information explosion,
democratization of governments, etc., have also led to changes in its theory and practice. Yet,
a definition of management is necessary for its teaching and research, and also for
improvement in its practice. Many management experts have tried to define management.
But, no definition of management has been universally accepted. Let us discuss some of the
leading definitions of management: Peter F. Drucker defines, "management is an organ;
organs can be described and defined only through their functions". According to Terry,
"Management is not people; it is an activity like walking, reading, swimming or running.
People who perform Management can be designated as members, members of Management
or executive leaders." Ralph C. Davis has defined Management as, "Management is the
function of executive leadership anywhere." 6 According to Mc Farland, "Management is
defined for conceptual, theoretical and analytical purposes as that process by which managers
create, direct, maintain and operate purposive organization through systematic, co-ordinated
co-operative human effort." Henry Fayol, "To mange is to forecast and plan, to organize, to
compound, to co-ordinate and to control." Harold Koontz says, "Management is the art of
getting things done through and within formally organized group." William Spriegal,
"Management is the function of an enterprise which concerns itself with direction and control
of the various activities to attain business objectives. Management is essentially an executive
function; it deals with the active direction of the human effort." Kimball and Kimball,
"Management embraces all duties and functions that pertain to the initiation of an enterprise,
its financing, the establishment of all major policies, the provision of all necessary
equipment, the outlining of the general form of organization under which the enterprise is to
operate and the selection of the principal officers." Sir Charles Reynold, "Management is the
process of getting things done through the agency of a community. The functions of
management are the handling of community with a view of fulfilling the purposes for which
it exists." 7 E.F.L. Brech, "Management is concerned with seeing that the job gets done, its
tasks all centre on planning and guiding the operations that are going on in the enterprise."
Koontz and O'Donnel, "Management is the creation and maintenance of an internal
environment in an enterprise where individuals, working in groups, can perform efficiently
and effectively toward the attainment of group goals. It is the art of getting the work done
through and with people in formally organized groups." James Lundy, "Management is
principally a task of planning, coordinating, motivating and controlling the efforts of other
towards a specific objective. It involves the combining of the traditional factors of production
land, labour, capital in an optimum manner, paying due attention, of course, to the particular
goals of the organization." Wheeler, "Management is centered in the administrators or
managers of the firm who integrate men, material and money into an effective operating
limit." J.N. Schulze, "Management is the force which leads guides and directs an organization
in the accomplishment of a pre-determined object." Oliver Scheldon, "Management proper is
the function in industry concerned in the execution of policy, within the limits set up by the
administration and the employment of the organization for the particular objectives set before

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it." 8 Keith and Gubellini, "Management is the force that integrates men and physical plant
into an effective operating unit." Newman, Summer and Warren, "The job of Management is
to make co-operative endeavour to function properly. A manager is one who gets things done
by working with people and other resources in order to reach an objective." G.E. Milward,
"Management is the process and the agency through which the execution of policy is planned
and supervised." Ordway Tead, "Management is the process and agency which directs and
guides the operations of an organization in the realizing of established aims." Mary Parker
Follett defines management as the "art of getting things done through people". This definition
calls attention to the fundamental difference between a manager and other personnel of an
organization. A manager is one who contributes to the organization’s goals indirectly by
directing the efforts of others – not by performing the task himself. On the other hand, a
person who is not a manager makes his contribution to the organization’s goals directly by
performing the task himself. Sometimes, however, a person in an organization may play both
these roles simultaneously. For example, a sales manager is performing a managerial role
when he is directing his sales force to meet the organization’s goals, but when he himself is
contacting a large customer and negotiating a deal, he is performing a non-managerial role. In
the former role, he is directing the efforts of others and is contributing to the organization’s
goals indirectly; in the latter role, he is directly utilizing his skills as a salesman to meet the
organization’s objectives.

CHARACTERISTICS OF MANAGEMENT

Management is a distinct activity having the following salient features:

1. Economic Resource: Management is one of the factors of production

together with land, labour and capital. As industrialization increases, the
need for managers also increases. Efficient management is the most critical
input in the success of any organized group activity as it is the force which
assembles and integrates other factors of production, namely, labour, capital
and materials. Inputs of labour, capital and materials do not by themselves
ensure production; they require the catalyst of management to produce
goods and services required by the society. Thus, management is an
essential ingredient of an organization.

2. Goal Oriented: Management is a purposeful activity. It coordinates the

efforts of workers to achieve the goals of the organization. The success of
management is measured by the extent to which the organizational goals are
achieved. It is imperative that the organizational goals must be well-defined
and properly understood by the management at various levels.

3. Distinct Process: Management is a distinct process consisting of such

functions as planning, organizing, staffing, directing and controlling. These
functions are so interwoven that it is not possible to lay down exactly the
sequence of various functions or their relative significance.

4. Integrative Force: The essence of management is integration of human and

other resources to achieve the desired objectives. All these resources are
made available to those who manage. Managers apply knowledge,

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 experience and management principles for getting the results from the
workers by the use of non-human resources. Managers also seek to
harmonize the individuals' goals with the organizational goals for the
smooth working of the organization.

5. System of Authority: Management as a team of managers represents a

system of authority, a hierarchy of command and control. Managers at
different levels possess varying degree of authority. Generally, as we move
down in the managerial hierarchy, the degree of authority gets gradually
reduced. Authority enables the managers to perform their functions
effectively.

6. Multi-disciplinary Subject: Management has grown as a field of study (i.e.

discipline) taking the help of so many other disciplines such as engineering,
anthropology, sociology and psychology. Much of the management
literature is the result of the association of these disciplines. For instance,
productivity orientation drew its inspiration from industrial engineering and
human relations orientation from psychology. Similarly, sociology and
operations research have also contributed to the development of
management science.

7. Universal Application: Management is universal in character. The principles

and techniques of management are equally applicable in the fields of
business, education, military, government and hospital. Henri Fayol
suggested that principles of management would apply more or less in every
situation. The principles are working guidelines which are flexible and
capable of adaptation to every organization where the efforts of human
beings are to be coordinated.

MANAGEMENT FUNCTIONS

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 There is enough disagreement among management writers on the classification of
managerial functions. Newman and Summer recognize only four functions, namely,
organizing, planning, leading and controlling. Henri Fayol identifies five functions of
management, viz. planning, organizing, commanding, coordinating and controlling. Luther
Gulick states seven such functions under the catch word "POSDCORB' which stands for
planning, organizing, staffing, directing, coordinating, reporting and budgeting. Warren
Haynes and Joseph Massie classify management functions into decision-making, organizing,
staffing, planning, controlling, communicating and directing. Koontz and O'Donnell divide
these functions into planning organizing, staffing, directing and controlling. For our purpose,
we shall designate the following six as the functions of a manager: planning, organizing,
staffing, directing, coordinating and controlling.

1. Planning: Planning is the most fundamental and the most pervasive of all
management functions. If people working in groups have to perform effectively,
they should know in advance what is to be done, what activities they have to
perform in order to do what is to be done, and when it is to be done. Planning is
concerned with 'what', 'how, and 'when' of performance. It is deciding in the
present about the future objectives and the courses of action for their achievement.

It thus involves:

(a) determination of long and short-range objectives;

(b) development of strategies and courses of actions to be followed for the
achievement of these objectives;
(c) formulation of policies, procedures, and rules, etc., for the implementation of
strategies, and plans.

The organizational objectives are set by top management in the context of its
basic purpose and mission, environmental factors, business forecasts, and available
potential resources. These objectives are both long-range as well as short-range. They
are divided into divisional, departmental, sectional and individual objectives or goals.
This is followed by the development of strategies and courses of action to be followed
at various levels of management and in various segments of the organization. Policies,
procedures and rules provide the framework of decision making, and the method and
order for the making and implementation of these decisions. Every manager performs
all these planning functions, or contributes to their performance. In some
organizations, particularly those which are traditionally managed and the small ones,
planning are often not done deliberately and systematically but it is still done. The
plans may be in the minds of their managers rather than explicitly and precisely spelt
out: they may be fuzzy rather than clear but they are always there. Planning is thus the
most basic function of management. It is performed in all kinds of organizations by all
managers at all levels of hierarchy.

2. Organizing: Organizing involves identification of activities required for the

achievement of enterprise objectives and implementation of plans; grouping of
activities into jobs; assignment of these jobs and activities to departments and
individuals; delegation of responsibility and authority for performance, and provision
for vertical and horizontal coordination of activities. Every manager has to decide
what activities have to be undertaken in his department or section for the achievement

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of the goals entrusted to him. Having identified the activities, he has to group identical
or similar activities in order to make jobs, assign these jobs or groups of activities to
his subordinates, delegate authority to them so as to enable them to make decisions
and initiate action for undertaking these activities, and provide for coordination
between himself and 14 his subordinates, and among his subordinates.
Organizing thus involves the following sub-functions:
(a) Identification of activities required for the achievement of objectives and
implementation of plans.
(b) Grouping the activities so as to create self-contained jobs.
(c) Assignment of jobs to employees.
(d) Delegation of authority so as to enable them to perform their jobs and to command
the resources needed for their performance.
(e) Establishment of a network of coordinating relationships.

Organizing process results in a structure of the organization. It comprises

organizational positions, accompanying tasks and responsibilities, and a network of
roles and authority-responsibility relationships. Organizing is thus the basic process of
combining and integrating human, physical and financial resources in productive
interrelationships for the achievement of enterprise objectives. It aims at combining
employees and interrelated tasks in an orderly manner so that organizational work is
performed in a coordinated manner, and all efforts and activities pull together in the
direction of organizational goals.

3. Staffing: Staffing is a continuous and vital function of management. After the

objectives have been determined, strategies, policies, programmes, procedures and
rules formulated for their achievement, activities for the implementation of strategies,
policies, programmes, etc. identified and grouped into jobs, the next logical step in the
15 management process is to procure suitable personnel for manning the jobs. Since
the efficiency and effectiveness of an organization significantly depends on the
quality of its personnel and since it is one of the primary functions of management to
achieve qualified and trained people to fill various positions, staffing has been
recognized as a distinct function of management. It comprises several sub functions:

(a) Manpower planning involving determination of the number and the kind of
personnel required.

(b) Recruitment for attracting adequate number of potential employees to seek jobs in
the enterprise.

(c) Selection of the most suitable persons for the jobs under consideration.

(d) Placement, induction and orientation.

(e) Transfers, promotions, termination and layoff.

(f) Training and development of employees. As the importance of human factor in

organizational effectiveness is being increasingly recognized, staffing is gaining
acceptance as a distinct function of management. It need hardly any emphasize that no
organization can ever be better than its people, and managers must perform the
staffing function with as much concern as any other function.

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4. Directing: Directing is the function of leading the employees to perform efficiently,
and contribute their optimum to the achievement of organizational objectives. Jobs
assigned to subordinates have to be explained and clarified, they have to be provided
guidance in job performance and they are to be motivated to contribute their optimum
performance with zeal and enthusiasm. The function of directing thus involves the
following sub-functions:

(a) Communication
(b) Motivation
(c) Leadership

5. Controlling: Controlling is the function of ensuring that the divisional,

departmental, sectional and individual performances are consistent with the
predetermined objectives and goals. Deviations from objectives and plans have to be
identified and investigated, and correction action taken. Deviations from plans and
objectives provide feedback to managers, and all other management processes
including planning, organizing, staffing, directing and coordinating are continuously
reviewed and modified, where necessary. Controlling implies that objectives, goals
and standards of performance exist and are known to employees and their superiors. It
also implies a flexible and dynamic organization which will permit changes in
objectives, plans, programmes, strategies, policies, organizational design, staffing
policies and practices, leadership style, communication system, etc., for it is not
uncommon that employees failure to achieve predetermined standards is due to
defects or shortcomings in any one or more of the above dimensions of management.
Thus, controlling involves the following process:

(a) Measurement of performance against predetermined goals.

(b) Identification of deviations from these goals.
(c) Corrective action to rectify deviations.

It may be pointed out that although management functions have been

discussed in a particular sequence-planning, organizing, staffing, directing,
coordinating and controlling – they are not performed in a sequential order.
Management is an integral process and it is difficult to put its functions neatly in
separate boxes. Management functions 18 tend to coalesce, and it sometimes becomes
difficult to separate one from the other. For example, when a production manager is
discussing work problems with one of his subordinates, it is difficult to say whether
he is guiding, developing or communicating, or doing all these things simultaneously.
Moreover, managers often perform more than one function simultaneously.

MANAGEMENT VS. ADMINISTRATION

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 The use of two terms management and administration has been a controversial
issue in the management literature. Some writers do not see any difference between
the two terms, while others maintain that administration and management are two
different functions. Those who held management and administration distinct include
Oliver Sheldon, Florence and Tead, Spriegel and Lansburg, etc. According to them,
management is a lower-level function and is concerned primarily with the execution
of policies laid down by administration. But some English authors like Brech are of
the opinion that management is a wider term including administration. This
controversy is discussed as under in three heads:

(i) Administration is concerned with the determination of policies and

management with the implementation of policies. Thus, administration is a
higher level function.

(ii) Management is a generic term and includes administration.

(iii) There is no distinction between the terms management and administration and
they are used interchangeably.

Administration is a Higher Level Function: Oliver Shelden subscribed to the

first viewpoint. According to him, "Administration is concerned with the
determination of corporate policy, the coordination of finance, production and
distribution, the settlement of the compass of the organization and the ultimate control
of the executive. Management proper is concerned with the execution of policy within
the limits set up by administration and the employment of the organization in the
particular objects before it... Administration determines the organization; management
uses it. Administration defines the goals; management strives towards it".
Administration refers to policy-making whereas management refers to execution of
policies laid down by administration. This view is held by Tead, Spriegel and Walter.
Administration is the phase of business enterprise that concerns itself with the overall
determination of institutional objectives and the policies unnecessary to be followed
in achieving those objectives. Administration is a determinative function; on the other
hand, management is an executive function which is primarily concerned with
carrying out of the broad policies laid down by the administration. Thus,
administration involves broad policy-making and management involves the execution
of policies laid down by the administration. Administration Vs. Management Basis
Administration Management

1. Meaning Administration is concerned with Management means

getting the formulation of objectives, plans the work done through
and policies of the organization with others.

2. Nature of Administration relates to the decision- Management refers to

execution work making. It is a thinking function. of decisions. It is a doing function.
3. Decision Administration determines what is to Management decides who
shall Making be done and when it is to be done implement the administrative
decisions.

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 4. Status Administration refers to higher levels Management is relevant at
lower of management levels in the organization

. Management is a Generic Term: The second viewpoint regards management as a

generic term including administration. According to Brech, "Management is a social process
entailing responsibility for the effective and economical planning and regulation of the
operation of an enterprise in fulfillment of a given purpose or task. Administration is that part
of management which is concerned with the installation and carrying out of the procedures by
which the programme is laid down and communicated and the progress of activities is
regulated and checked against plans". Thus, Brech conceives administration as a part of
management. Kimball and Kimball also subscribe to this view. According to them
administration is a part of management. Administration is concerned with the actual work of
executing or carrying out the objectives. Management and Administration are Synonymous:
The third viewpoint is that there is no distinction between the terms 'management' and
'administration'. Usage also provides no distinction between these terms. The term
management is used for higher executive functions like determination of policies, planning,
organizing, directing and controlling in the business circles, while the term administration is
used for the same set of functions in the Government circles. So there is no difference
between these two terms and they are often used interchangeably. It seems from the above
concepts of administration and management that administration is the process of
determination of objectives, laying down plans and policies, and ensuring that achievements
are in conformity with the objectives. Management is the process of executing the plans and
policies for the achievement of the objectives determined by an administration. This
distinction seems to be too simplistic and superficial. If we regard chairmen, managing
directors and general managers as performing administrative functions, it cannot be said that
they perform only planning functions of goal determination, planning and policy formulation,
and do not perform other functions such as staffing functions of selection and promotion, or
directing functions of leadership, communication and motivation. On the other hand, we
cannot say that managers who are responsible for the execution of plans and formulation of
plans and policies, etc. do not contribute to the administrative functions of goal
determination, and formulation of plans and policies. In fact all manages, whether the chief
executive or the first line supervisor, are in some way or the other involved in the
performance of all the managerial functions. It is, of course, true that those who occupy the
higher echelons of organizational hierarchy are involved to a greater extent in goal
determination, plans and policy formulation and organizing than those who are at the bottom
of the ladder.

LEVELS OF MANAGEMENT

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 An enterprise may have different levels of management. Levels of management refer
to a line of demarcation between various managerial positions in an enterprise. The levels of
management depend upon its size, technical facilities, and the range of production. We
generally come across two broad levels of management,

(i) administrative management (i.e., the upper level of management) and

(ii) (ii) Operating management (i.e., the lower level of management).
Administrative management is concerned with "thinking" functions such as
laying down policy, planning and setting up of standards. Operative
management is concerned with the "doing" function such as implementation
of policies, and directing the operations to attain the objectives of the
enterprise. But in actual practice, it is difficult to draw any clear cut
demarcation between thinking function and doing function. Because the
basic/fundamental managerial functions are performed by all managers
irrespective of their levels or, ranks. For instance, wage and salary director of
a company may assist in fixing wages and salary structure as a member of the
Board of Directors, but as head of wages and salary department, his job is to
see that the decisions are implemented. The real significance of levels is that
they explain authority relationships in an organization. Considering the
hierarchy of authority and responsibility, one can identify three levels of
management namely:

(i) Top management of a company consists of owners/shareholders,

Board of Directors, its Chairman, Managing Director, or the Chief
Executive, or the General Manager or Executive Committee having
key officers.

(ii) Middle management of a company consists of heads of functional

departments viz. Purchase Manager, Production Manager, Marketing
Manager, Financial controller, etc. and Divisional and Sectional
Officers working under these Functional Heads.

(iii) Lower level or operative management of a company consists of

Superintendents, Foremen, Supervisors, etc.

1. Top management - is the ultimate source of authority and it lays down goals, policies
and plans for the enterprise. It devotes more time on planning and coordinating
functions. It is accountable to the owners of the business of the overall management.
It is also described as the policy making group responsible for the overall direction
and success of all company activities. The important functions of top management
include:

(a) To establish the objectives or goals of the enterprise.

(b) To make policies and frame plans to attain the objectives laid.
(c) To set up an organizational frame work to conduct the operations as per
plans.

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 (d) To assemble the resources of money, men, materials, machines and
methods to put the plans into action.

(e) To exercise effective control of the operations.

(f) To provide overall leadership to the enterprise.

2. Middle management: The job of middle management is to implement the policies and
plans framed by the top management. It serves as an essential link between the top
management and the lower level or operative management. They are responsible to
the top management for the functioning of their departments. They devote more time
on the organization and motivation functions of management. They provide the
guidance and the structure for a purposeful enterprise. Without them the top
management's plans and ambitious expectations will not be fruitfully realized. The
following are the main functions of middle management :

(a) To interpret the policies chalked out by top management.

(b) To prepare the organizational set up in their own departments for fulfilling the
objectives implied in various business policies.
(c) To recruit and select suitable operative and supervisory staff.

(d) To assign activities, duties and responsibilities for timely implementation of the plans.

(e) To compile all the instructions and issue them to supervisor under their control.

(f) To motivate personnel to attain higher productivity and to reward them properly.

(g) To cooperate with the other departments for ensuring a smooth functioning of the
entire organization.

(h) To collect reports and information on performance in their departments.

(i) To report to top management

(j) To make suitable recommendations to the top management for the better execution of
plans and policies.

3. Lower or operative management: It is placed at the bottom of the hierarchy of

management, and actual operations are the responsibility of this level of management.
It consists of foreman, supervisors, sales officers, accounts officers and so on. They
are in direct touch with the rank and file or workers. Their authority and responsibility
is limited. They pass on the instructions of the middle management to workers. They
interpret and divide the plans of the management into short-range operating plans.
They are also involved in the process of decisions-making. They have to get the work
done through the workers. They allot various jobs to the workers, evaluate their
performance and report to the middle level management. They are more concerned
with direction and control functions of management. They devote more time in the
supervision of the workers.

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 MANAGERIAL SKILLS

A skill is an individual's ability to translate knowledge into action. Hence, it is

manifested in an individual's performance. Skill is not necessarily inborn. It can be developed
through practice and through relating learning to one's own personal experience and
background. In order to be able to successfully discharge his roles, a manager should possess
three major skills. These are conceptual skill, human relations skill and technical skill.
Conceptual skill deals with ideas, technical skill with things and human skill with people.
While both conceptual and technical skills are needed for good decision-making, human skill
in necessary for a good leader. The conceptual skill refers to the ability of a manager to take a
broad and farsighted view of the organization and its future, his ability to think in abstract, his
ability to analyze the forces working in a situation, his creative and innovative ability and his
ability to assess the environment and the changes taking place in it. It short, it is his ability to
conceptualize the environment, the organization, and his own job, so that he can set
appropriate goals for his organization, for himself and for his team. This skill seems to
increase in importance as manager moves up to higher positions of responsibility in the
organization. The technical skill is the manager's understanding of the nature of job that
people under him have to perform. It refers to a person's knowledge and proficiency in any
type of process or technique. In a production department this would mean an understanding
of the technicalities of the process of production. Whereas this type of skill and competence
seems to be more important at the lower levels of management, its relative importance as a
part of the managerial role diminishes as the manager moves to higher positions. In higher
functional positions, such as the position of a marketing manager or production manager, the
conceptual component, related to these functional areas becomes more important and the
technical component becomes less important. Human relations skill is the ability to interact
effectively with people at all levels. This skill develops in the manager sufficient ability

(a) to recognize the feelings and sentiments of others;

(b) to judge the possible actions to, and outcomes of various courses of action he may
undertake;
(c) to examine his own concepts and values which may enable him to develop more
useful attitudes about himself.

This type of skill remains consistently important for managers at all levels. That is
why, people at the top shift with great ease from one industry to another without an
apparent fall in their efficiency. Their human and conceptual skills seem to make up
for their unfamiliarity with the new job's technical aspects. Skill-mix of different
management levels Top Management Conceptual Skills Middle Management Human
Relations Skills Low Management Technical Skills.

THE MANAGER AND HIS JOB

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 Management performs the functions of planning, organizing, staffing,
directing and controlling for the accomplishment of organizational goals. Any person
who performs these functions is a manager. The first line manager or supervisor or
foreman is also a manager because he performs these functions. The difference
between the functions of top, middle and lowest level management is that of degree.
For instance, top management concentrates more on long-range planning and
organizing, middle level management concentrates more on coordination and control
and lowest level management concentrates more on direction function to get the
things done from the workers. Every manager is concerrned with ideas, things and
people. Management is a creative process for integrating the use of resources to
accomplish certain goals. In this process, ideas, things and people are vital inputs
which are to be transformed into output consistent with the goals. Management of
ideas implies use of conceptual skills. It has three connotations.
First, it refers to the need for practical philosophy of management to regard
management as a distinct and scientific process.
Second, management of ideas refers to the planning phase of management
process.
Lastly, management of ideas refers to distinction and innovation.

Creativity refers to generation of new ideas and innovation refers to

transforming ideas into viable relations and utilities.

A manager must be imaginative to plan ahead and to create new ideas.

Management of things (non-human resources) deal with the design of

production system, acquisition, allocation and conversion of physical resources to
achieve certain goals. Management of people is concerned with procurement,
development, maintenance and integration of human resources in the organization.
Every manager has to direct his subordinates to put the organizational plans into
practice. The greater part of every manager's time is spent in communicating and
dealing with people. His efforts are directed towards obtaining information and
evaluating progress towards objectives set by him and then taking corrective action.
Thus, a manager's job primarily consists of management of people. Though it is his
duty to handle all the productive resources, but human factor is more important. A
manager cannot convert the raw materials into finished products himself; he has to
take the help of others to do this. The greatest problem before any manager is how to
manage the personnel to get the best possible results. The manager in the present age
has to deal efficiently with the people who are to contribute for the achievement of
organizational goals. Peter F. Drucker has advocated that the managerial approach to
handle workers and work should be pragmatic and dynamic. Every job should be
designed as an integrated set of operations. The workers should be given a sufficient
measure of freedom to organize and control their work environment. It is the duty of
every manager to educate, train and develop people below him so that they may use
their potentialities and abilities to perform the work allotted to them. He has also to
help them in satisfying their needs and working under him, he must provide them with
proper environment. A manager must create a climate which brings in and maintains
satisfaction and discipline among the people. This will increase organizational
effectiveness. Recently, it has been questioned whether planning, organizing,
directing and controlling provides an adequate description of the management
process. After an intensive observation of what five top executive actually did during

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the course of a few days at work, Henry Mintzberg concluded that these labels do not
adequately capture the reality of what managers do. He suggested instead that the
manager should be regarded as playing some ten different roles, in no particular order.
Role Performed by Managers

1. Interpersonal Roles Figurehead: In this role, every manager has to perform

some duties of a ceremonial nature, such as greeting the touring dignitaries,
attending the wedding of an employee, taking an important customer to
lunch and so on.

a. Leader : As a leader, every manager must motivate and

encourage his employees. He must also try to reconcile their
individual needs with the goals of the organization.

b. Liaison : In this role of liaison, every manager must cultivate

contacts outside his vertical chain of command to collect
information useful for his organization.

2. Informational Roles Monitor: As monitor, the manager has to perpetually

scan his environment for information, interrogate his liaison contacts and
his subordinates, and receive unsolicited information, much of it as result
of the network of personal contacts he has developed.

3. Disseminator: In the role of a disseminator, the manager passes some of

his privileged information directly to his subordinates who would
otherwise have no access to it.

a. Spokesman: In this role, the manager informs and satisfies

various groups and people who influence his organization. Thus,
he advises shareholders about financial performance, assures
consumer groups that the organization is fulfilling its social
responsibilities and satisfies government that the origination is
abiding by the law.

4. Decisional Roles Entrepreneur : In this role, the manager constantly

looks out for new ideas and seeks to improve his unit by adapting it
to changing conditions in the environment.

a. Handler : In this role, the manager has to work like a fire fighter.
He must seek solutions of various unanticipated problems – a
strike may loom large a major customer may go bankrupt; a
supplier may renege on his contract, and so on. Resource

b. Allocator : In this role, the manager must divide work and

delegate authority among his subordinates. He must decide who
will get what.

c. Negotiator : The manager has to spend considerable time in

negotiations.

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 Thus, the chairman of a company may negotiate with the union leaders a new strike
issue, the foreman may negotiate with the workers a grievance problem, and so on. In
addition, managers in any organization work with each other to establish the organization’s
long-range goals and to plan how to achieve them. They also work together to provide one
another with the accurate information needed to perform tasks. Thus, managers act as
channels of communication with the organization.

CHARACTERISTICS OF PROFESSIONAL MANAGERS.

1. Managers are responsible and accountable: Managers are responsible for seeing
that specific tasks are done successfully. They are usually evaluated on how well
they arrange for these tasks to the accomplished. Managers are responsible for the
actions of their subordinates. The success or failure of subordinates is a direct
reflection of managers' success or failure. All members of an organization,
including those who are not managers, are responsible for their particular tasks.
The difference is that managers are held responsible, or accountable, not only for
their own work, but also for the work of subordinates.

2. Managers balance competing goals and set priorities: At any given time, the
manager faces a number of organizational goals, problems and needs all of which
compete for the manager's time and resources (both human and material). Because
such resources are always limited, the manager must strike a balance between the
various goals and needs. Many managers, for example, arrange each day's tasks in
order of priority the most important things are done right away, while the less
important tasks are looked at later. In this way, managerial time is used
effectively. A manager must also decide who is to perform a particular task and
must assign work to an appropriate person. Although ideally each person should
be given the task he would most like to do, this is not always possible. Sometimes
individual ability is the decisive factor, and a task is assigned to the person most
able to accomplish it. But sometimes a less capable worker is assigned a task as a
learning experience. And, at times, limited human or other resources dictate
decisions for making work assignments. Managers are often caught between
conflicting human and organizational needs and so they must identify priorities.

3. Managers think analytically and conceptually: To be an analytical thinker, a

manager must be able to break a problem down into its components, analyze those
components and then come up with a feasible solution. But even more important,
a manager must be a conceptual thinker, able to view the entire task in the abstract
and relate it to other tasks. Thinking about a particular task in relation to its larger
implications is no simple matter. But it is essential if the manager is to work
towards the goals of the organization as a whole as well as towards the goals of an
individual unit.

4. Managers are mediators: Organizations are made up of people, and people

disagree or quarrel quite often. Disputes within a unit or organization can lower
morale and productivity, and they may become so unpleasant or disruptive that

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 competent employees decide to leave the organization. Such occurrences hinder
work towards the goals of the unit or organization; therefore, managers must at
times take on the role of mediator and iron out disputes before they get out of
hand. Setting conflicts requires skill and tact. Managers who are careless in their
handling conflicts may later on find that they have only made matters worse.

5. Managers make difficult decisions : No organization runs smoothly all the time.
There is almost no limit to the number and types of problems that may occur :
financial difficulties, problems with employees, or differences of opinion
concerning an organization policy, to name just a few. Managers are expected to
come up with solutions to difficult problems and to follow through on their
decisions even when doing so may be unpopular.

This description of these managerial roles and responsibilities shows that managers
must 'change hats' frequently and must be alert to the particular role needed at a given time.
The ability to recognize the appropriate role to be played and to change roles readily is a
mark of an effective manager.

PRINCIPLES OF MANAGEMENT

A body of principles of management has been developed by Henri Fayol, the father of
modern management. Fayol wrote perceptibly on the basis of his practical experience as a
manager. Although, he did not develop an integrated theory of management, his principles
are surprisingly in tune with contemporary thinking in management theory. Fayol held that
there is a single "administrative science", whose principles can be used in all management
situations no matter what kind of organization was being managed. This earned him the title
of "Universality". He, however, emphasized that his principles were not immutable laws but
rules of thumb to be used as occasion demanded. Fayol held that activities of an industrial
enterprise can be grouped in six categories :
(i) technical (production),
(ii) commercial (buying, selling and exchange),
(iii) financial (search for and optimum use of capital),
(iv) security (protection of property and persons),
(v) accounting (including statistics); and
(vi) managerial.

However, he devoted most of his attention to managerial activity. He developed the

following principles underlying management of all kinds of organizations :

1. Authority and Responsibility are Related : Fayol held that authority flows
from responsibility. Managers who exercise authority over others should
assume responsibility for decisions as well as for results. He regarded
authority as a corollary to responsibility. Authority is official as well as
personal. Official authority is derived from the manager's position in
organizational hierarchy and personal authority is compounded of
intelligence, experience, moral worth, past services, etc. A corollary of the

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 principle that no manager should be given authority unless he assumes
responsibility is that those who have responsibility should also have
commensurate authority in order to enable them to initiate action on others
and command resources required for the performance of their functions.
This aspect of relationship between responsibility and authority is
particularly relevant in India where authority tends to be concentrated in
higher echelons of management.

2. Unity of Command : This principle holds that one employee should have
only one boss and receive instructions from him only. Fayol observed that if
this principle is violated authority will be undermined, discipline will be
jeopardy, order will be disturbed and stability will be threatened. Dual
command is a permanent source of conflict. Therefore, in every
organization, each subordinate should have one superior whose command
he has to obey.

3. Unity of Direction : This means that all managerial and operational

activities which relate a distinct group with the same objective should be
directed by "one head and one plan. According to Fayol, there should be,
"one head and one plan for a group of activities having the same objective".
It, however, does not mean that all decisions should be made at the top. It
only means that all related activities should be directed by one person. For
example, all marketing activities like product strategy and policy,
advertising and sales promotion, distribution channel policy, product
pricing policy, marketing research, etc., should be under the control of one
manager 39 and directed by an integrated plan. This is essential for the
"unity of action, coordination of strength and focusing of effort". Violation
of this principle will cause fragmentation of action and effort, and wastage
of resources.
4. Scalar Chain of Command : According to Fayol scalar chain is the chain of
superiors ranging from the ultimate authority to the lowest ranks. The line
of authority is the route followed via every link in the chain by all
communication which start from or go to the ultimate authority.

5. Division of Work : This is the principle of specialization which, according

to Fayol, applies to all kinds of work, managerial as well as technical. It
helps a person to acquire an ability and accuracy with which he can do
more and better work with the same effort. Therefore, the work of every
person in the organization should be limited as far as possible to the
performance of a single leading function.

6. Discipline : Discipline is a sine qua non for the proper functioning of an

organization. Members of an organization are required to perform their
functions and conduct themselves in relation to others according to rules,
norms and customs. According to Fayol, discipline can best be maintained
by :

(i) having good superiors at all levels;

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(ii) agreements (made either with the individual employees or with a union as the
case may be) that are as clear and fair as possible; and

(iii) penalties judiciously imposed.

7. Subordination of Individual Interest to General Interest : The interest of the

organization is above the interests of the individual and the group. It can be
achieved only when managers in high positions in the organization set an
example of honesty, integrity, fairness and justice. It will involve an attitude
and a spirit of sacrificing their own personal interests whenever it becomes
apparent that such personal interests are in conflict with organizational
interests. It may, however, be emphasized that social and national interests
should have precedence over organizational interests whenever the two run
counter to each other.

8. Remuneration : Employees should be paid fairly and equitably.

Differentials in remuneration should be based on job differentials, in terms
of qualities of the employee, application, responsibility, working conditions
and difficulty of the job. It should also take into account factors like cost of
living, general economic conditions, demand for labour and economic state
of the business.

9. Centralization : Fayol believed in centralisation. He, however, did not

contemplate concentration of all decision making authority in the top
management. He, however, held that centralisation and decentralisation is a
question of proportion. In a small firm with a limited number of employees,
the owner-manager can give orders directly to everyone. In large
organizations, however, where the worker is separated from the chief
executive through a long scalar chain, the decision making authority has to
be distributed among various managers in varying degrees. Here one
generally comes across a situation of decentralisation with centralised
control. The degree of centralisation and decentralisation also depends on
the quality of managers.

10. Order : Order, in the conception of Fayol, means right person on the right
job and everything in its proper place. This kind of order, depends on
precise knowledge of human requirements and resources of the concern and
a constant balance between these requirements and resources.

11. Equity : It means that subordinates should be treated with justice and
kindliness. This is essential for eliciting their devotion and loyalty to the
enterprise. It is, therefore the duty of the chief executive to instill a sense of
equity throughout all levels of scalar chain.

12. Stability of Tenure of Personnel : The managerial policies should provide a

sense of reasonable job security. The hiring and firing of personnel should
depend not on the whims of the superiors but on the well-conceived

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 personnel policies. He points out that it takes time for an employee to learn
his job; if they quit or are discharged within a short time, the learning time
has been wasted. At the same time those found unsuitable should be
removed and those who are found to be competent should be promoted.
However, "a mediorce manager who stays is infinitely preferable to
outstanding managers who come and go".

13. Initiative : It focuses on the ability, attitude and resourcefulness to act

without prompting from others. Managers must create an environment
which encourages their subordinates to take initiative and responsibility.
Since it provides a sense of great satisfaction to intelligent employees,
managers should sacrifice their personal vanity in order to encourage their
subordinates to show initiative. It should, however, be limited, according to
Fayol, by respect for authority and discipline.

14. Esprit de Corps : Cohesiveness and team spirit should be encouraged

among employees. It is one of the chief characteristics of organized activity
that a number of people work together in close coopearation for the
achievement of common goals. An environment should be created in the
organization which will induce people to contribute to each other's efforts in
such a way that the combined effort of all together promotes the
achievement of the overall objectives of enterprise. Fayol warns against two
enemies of esprit de corps, viz. (i) divide and rule, and (ii) abuse of written
communication. It may work to the benefit of the enterprise to divide its
enemy but it will surely be dangerous to divide one's own workers. They
should rather be welded in cohesive and highly interacting work-groups.
Overreliance on written communication also tends to disrupt team spirit.
Written communication, where necessary, should always be supplemented
by oral communication because face-to-face contacts tend to promote
speed, clarity and harmony. The other important principles of management
as developed by pioneer thinkers on the subject are :

(a) Separation of planning and execution of business operations.

(b) Scientific approach to business problems.

(c) Adoption of technological changes.

(d) Economizing production costs and avoiding the wastage of resources.

(e) Fuller utilization of the operational capacity and emphasis on higher

productivity.

(f) Standardisation of tools, machines, materials, methods, timings and

products.
(g) Evaluation of results according to criteria of standard levels of
performance.

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 (h) Understanding and co-operation among the members of the organization
set-up.

SIGNIFICANCE OF MANAGEMENT

Management is concerned with acquiring maximum prosperity with a minimum

effort. Management is essential wherever group efforts are required to be directed towards
achievement of common goals. In this management conscious age, the significance of
management can hardly be over emphasized. It is said that, anything minus management
amounts to nothing. Koontz and O' Donnel have rightly observed "there is no more important
area of human activity than management since its task is that of getting things done through
others." The significance of management in business activities is relatively greater. The
inputs of labour, capital and raw material never become productive without the catalyst of
management. It is now widely recognized that management is an important factor of growth
of any country. The following points further highlight the significance of management:

1. Achievements of group goals: Management makes group efforts more

effective. The group as a whole cannot realize its objectives unless and until
there is mutual co-operation and co-ordination among the members of the
group. Management creates team work and team spirit in an organization by
developing a sound organization structure. It brings the human and material
resources together and motivates the people for the achievement of the
goals of the organization.

2. Optimum utilization of resources: Management always concentrates on

achieving the objectives of the enterprise. The available resources of
production are put to use in such a way that all sort of wastage and
inefficiencies are reduced to a minimum. Workers are motivated to put in
their best performance by the inspiring leadership. Managers create and
maintain an environment conducive to highest efficiency and performance.
Through the optimum use of available resources, management accelerates
the process of economic growth.

3. Minimization of cost: In the modern era of intense competition, every

business enterprise must minimize the cost of production and distribution.
Only those concerns can survive in the market, which can produce goods of
better quality at the minimum cost. A study of the principles of management
helps in knowing certain techniques used for reducing costs. These
techniques are production control, budgetary control, cost control, financial
control, material control, etc.

4. Change and growth: A business enterprise operates in a constantly changing

environment. Changes in business environment create uncertainties and risk
and also produce opportunities for growth. An enterprise has to change and
adjust itself in the ever changing environment. Sound management moulds
not only the enterprise but also alters the environment itself to ensure the

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 success of the business. Many of the giant business corporations of today
had a 45 humble beginning and grew continuously through effective
management.

5. Efficient and smooth running of business: Management ensures efficient

and smooth running of business, through better planning, sound
organization and effective control of the various factors of production.

6. Higher profits: Profits can be enhanced in any enterprise either by

increasing the sales revenue or reducing costs. To increase the sales revenue
is beyond the control of an enterprise. Management by decreasing costs
increases its profits and thus provides opportunities for future growth and
development.

7. Provide innovation: Management gives new ideas, imagination and visions

to an enterprise.

8. Social benefits: Management is useful not only to the business firms but to
the society as a whole. It improves the standard of living of the people
through higher production and more efficient use of scarce resources. By
establishing cordial relations between different social groups, management
promotes peace and prosperity in society.

9. Useful for developing countries: Management has to play a more important

role in developing countries, like India. In such countries, the productivity
is low and the resources are limited. It has been rightly observed, "There are
no under-developed countries. They are only under-managed ones".

10. Sound organization structure: Management establishes proper organization

structure and avoids conflict between the superiors and subordinates. This
helps in the development of spirit of cooperation and mutual understanding,
and a congenial environment is provided in the organization.

SUMMARY
Management is the force that unifies various resources and is the process of bringing
them together and coordinating them to help accomplish organization goal. Management is
both, a science as well as art. It is an inexact science. However, its principles is distinguished

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from practice are of universal application. Management does not yet completely fulfill all the
criteria of a profession. There are three levels of management - top, middle and lower.
Managers at different levels of the organization require and use different types of skills.
Lower level managers require and use a greater degree of technical skill than high level
managers, while higher level managers require and use a greater degree of conceptual skill.
Human skills are important at all managerial levels.

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